Slowly but surely, sustainability gains traction

MANILA, Philippines — “The realization is that this is no longer a trend, but already a demand from many investors.”

That is what it takes for sustainability to take its next step forward, or to become mainstream, if you’ll ask Philippine Stock Exchange chief operating officer Roel Refran.

Refran has emphasized that sustainability should be embedded into decision-making — and not treated as just an afterthought — to ensure long-term resilience for businesses, for markets and for society.

Securities and Exchange Commission (SEC) chairperson Francis Lim admitted that sustainability has sat at the margins for years. It was important, but not decisive.

However, Lim said that this is no longer the case as investors are asking harder questions today.

“Climate risk. Transition risk. Governance weakness. Social fragility. These are no longer distant concerns. They are measurable. They are material. And they are shaping how capital is allocated. Which means sustainability disclosure can no longer be narrative. It must be decision-useful,” Lim said.

Through the issuance of Memorandum Circular 16 in 2025, Lim said the commission is raising the quality of disclosure to demand better information.

“Sustainability claims must not run ahead of facts. They must be grounded, measured and governed with discipline,” he said.

Starting this year, Lim said the SEC would implement this sustainability reporting reform through a phased and tiered approach. It will start with the largest listed companies and move across the market through 2029, with transition reliefs and assurance requirements to ensure both rigor and practicality.

“We recognize that not all institutions are equally prepared. Some have moved ahead. Others are still transitioning from broad narratives to structured, financially relevant disclosures,” Lim said.

“That is expected. Which is why we are pairing regulation with capacity-building — through training, guidance and market engagement,” he said.

Lim and Refran were among the key leaders who shared their insights at the recently held sustainability forum organized by the Economic Journalists Association of the Philippines. They were joined by Bangko Sentral ng Pilipinas Assistant Governor Pia Bernadette Tayag and Metro Pacific Investments Corp. chief finance, risk and sustainability officer Chaye Cabal-Revilla.

For her part, Cabal-Revilla said they do not look at sustainability as a burden, but instead, take it as a responsibility to look at resiliency and future-proof their businesses.

“Because in the case of the Philippines, where we get 20 to 25 category four to five storms on a yearly basis, we get flooding, etc., if we do not do anything, if we do not do our work to harden our assets and fortify our network, for example, then the Meralco poles will be down. We won’t have any water supply and therefore our businesses will also be impacted,” she said.

“So it is a responsibility to get answers and to fortify ourselves and to future-proof our businesses in the same way that we look at ourselves, as the private sector, to be part of the solution,” Cabal-Revilla added.

Cabal-Revilla said the group’s sustainability initiatives and improved reporting have resulted in investor gains, citing jumps in share prices of Meralco and Maynilad.

“We are living proof that sustainability works for us as a group,” she said.

On the banks’ end, Tayag said climate risk has emerged as one of the top risks, especially among rural and cooperative lenders, reflecting the growing exposure of businesses to extreme weather events and environmental disruptions.

“For our bigger banks, 70 percent of our banks are saying they are now integrating sustainability into their strategy, and 90 percent said they are inclined to support sustainable financing. So it can be climate-resilient agriculture, it can be renewable energy or climate-ready infrastructure. So there are signs that it’s being integrated. You’re seeing it from their appetite and their interest,” Tayag said.

“So the signs are there that it’s really beyond box-ticking, but really seeing it as a part of their operations,” she said.